Contributor ⭐

Promise to Eliminate Income Tax on Social Security

Forum|Forum|1 year ago
January 2, 2025
18 replies
8565 views

I'm reaching out to encourage everyone to contact their representatives and support President Trump's proposal to eliminate income taxes on Social Security benefits.

Here's why this matters:
Key Points to Consider
Currently, up to 85% of Social Security benefits can be subject to federal income tax1
About 67 million U.S. households receive monthly Social Security benefit checks3
The proposal would primarily help middle-income seniors who currently pay taxes on their benefits
Action Steps
Contact your local congressional representatives
Emphasize support for Trump's plan to remove Social Security benefit taxation
Highlight how this would provide financial relief for seniors
Important Caution
While the proposal sounds appealing, financial experts warn it could potentially harm the long-term sustainability of Social Security. The Congressional Budget Office estimates this tax cut could reduce Social Security revenue by approximately $950 billion between 2026-20353.
Recommended Communication Points
Express support for tax relief for seniors
Request careful consideration of long-term program funding
Ask for transparent analysis of the proposal's financial impact
Let's work together to ensure our voices are heard and our financial security is protected!

This topic has been closed for replies.

B

BalbonisMoleskine

Conversationalist ⭐⭐

Here's an idea: Eliminate taxes on SS benefits and tax 100% of the beneficiary's assets (e.g., home, life insurance, savings) upon death. This will recoup the cost of the lost taxes and increase the likelihood that the SS Trust Fund will have enough money to continue to pay living retirees.

This wouldn't be much different than the federal estate recovery rule, which requires states to put a lien on Medicaid recipients' assets (e.g., home, life insurance, vehicle) to recoup the cost of providing care so taxpayers don't have to shoulder that burden.

GailL1

Community Champion ⭐⭐⭐

@BalbonisMoleskine

I will have to think about that one a bit before replying BUT at least your thinking is moving in the right direction.

👍

IT‘S ALWAYS SOMETHING . . . . .. . . . Roseanne Roseannadanna

GailL1

Community Champion ⭐⭐⭐

@d196684e

Would eliminating this tax on benefits be ok with you IF we reduced the benefits that everybody is receiving to make up for this loss in income to the Trust Fund - that is exactly what will happen come around 2030 or so. OR maybe that reduction in the benefit amount would be built into the Elimination of the Tax on Benefits legislation.

By all means let’s get rid of the tax on benefits - we would just be losing even MORE money in the Trust Fund causing the time of insolvency to even come much earlier- maybe it will be a 25% reduction instead of closer to 20% - but we can plan ahead - RIGHT?

In 2023, taxes on benefits added $ 50.7 BILLION to the Social Security Trust Fund. The reason that this was added was to help out with the Trust Fund since we are no longer taking in enough in FICA taxes to cover benefits thus since 2021 we have been having to pull more and more money out of the Trust Fund reserve to pay benefits. The number of workers paying into the system has been greatly reduced with the advent of technology.

SSA.gov- Trust Fund DATA

See table 2 - Old-Age, Survivors, and Disability Insurance Trust Funds Income

Would you also support increasing the contribution rate for everybody who is working? The younger generations might think you are only looking out of yourself.

You could just think of these taxes as paying for a benefit you got while working - mainly the matched contributions paid by your employer for you.

If you say, just remove the tax max cap - I will scream because just doing this isn’t solving the insolvency problem because the tax max cap relates directly to capping the maximum benefit.

SSA.gov- Contribution and Benefit Base

Congress just repealed the Windfall Elimination and Government Pension Offset - Per the CBO this adjustment in benefits for those involved will COST the Trust Fund $200 BILLION over 10 years - now you want to even do more harm to the Trust Fund by elimination this tax on benefits.

I think I also read that more beneficiary’s DON’T pay taxes on their benefits than those that DO - so I don’t think those that DON’T pay taxes on their benefits will be supportive of pulling an income source from the Trust Fund.

Keep working on reducing the income going into the Trust Fund and we will all have to be tightening our belts.

IT‘S ALWAYS SOMETHING . . . . .. . . . Roseanne Roseannadanna

S

sgm55

Contributor ⭐⭐

Please post a link to the source of your claim, pertaining to how the income tax we currently are forced to pay on our social security income, that we've earned, will, if that payment is done away with, shrink the fund.

I submit that we do away with that forced payment, which is an insult to those of us who worked hard all of our lives, AND had the good sense to invest and save so that we have a good income from our investments, to this day. I strongly suggest that we do away with that tax on our senior incomes, AND do away with the BILLIONS OF DOLLARS we currently dole out to countries that we have no business supporting, monetarily. That saved money will be more than enough to keep the SSA sitting pretty in the years to come.

T

Tonster521

Community Champion ⭐

@GailL1 Although I already knew that most teachers who work at least 30 to 35 years in Non-covered Employment are provided pension benefits that are "gold plated" ,your client is probably around the median payout in most Non-covered Employment Plans. FYI and other readers, "gold plated" is a term that is used in the pension benefit business that refers to above average pension benefits. Once again, FYI and other readers, 30 years of service is generally equal to 33.% (.011 per year of service) of a person's average earnings whether 3 year, 5 year, or best 5 years our of last 10 years. Years in excess of 30 years are generally compensated at .012 or 1.2% per year of service. If you do the math for 35 years which is the time factor for social security, you will arrive at 39% which is just about the WEP factor 40%. that was established in 1984. It appears to me that the National Commission for Social Security Reform in 1983 did their homework and placed everyone on a level playing field. As I said before, it is an insult to the Survivors and Spouses who along with their Worker Spouses (husbands and wives) who worked in Covered Employment and paid dual FICA taxes. They will be reduced or offset SS benefits and folks in Non-covered employment are not reduced or offset and will, in effect, receive a bonus up to the 90% Bend Point. Is this what Congress and the President call a level playing field? I thought the following statistics may be interesting. I reviewed the Teacher Retirement System in my State and found stats from 2020 which is the most recent published data. There are almost 106,000 participants in the Plan and the median pension is $61,597 per year. There are 263 folks paid over $200,000 per year (16 folks receive over $300,000 per year). There are 66,696 that receive $50,000 per year or more (includes the above noted 263). Although there are a few that have more than 35 years of service, the majority have between 32 and 35 years of service which suggests that after graduation from college, they worked to about age 55 (early retirement) and found work in Covered Employment. Of course, some may have simply retired and did not work in Covered Employment..As you mentioned in another post, the SSA does not know who worked and who did not work in Covered employment after working in Non-covered employment.

WebWiseWoman

Community Champion ⭐⭐⭐

Neil deGrasse Tyson said it best “How sad it must be — believing that scientists, scholars, historians, economists, and journalists have devoted their entire lives to deceive you, while a reality tv star with decades of fraud and exhaustively documented lying is your only beacon of truth and honesty.”

GailL1

Community Champion ⭐⭐⭐

@d196684e

You will be happy to know that (2) RepublicanSenators introduced SB 358 last week that changes the limits for taxes on Social Security Benefits.

https://www.marshall.senate.gov/newsroom/press-releases/senators-marshall-blackburn-introduce-bill-to-reduce-excessive-taxation-on-social-security-benefits/

IT‘S ALWAYS SOMETHING . . . . .. . . . Roseanne Roseannadanna

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